At first, Margaret Thatcher’s response to my question about her reputation for handbagging people was mild enough. We were doing an interview for Channel 4 and she pointed to the bag on the table beside her, moving it so the cameras could get a good shot. She smiled and confided that the one really safe place for her to keep government secrets was in her handbag.

I’d been warned that she was the devil to interview because of her disconcerting habit of speaking or going silent in the “wrong” places, so I gave her a few seconds before moving on to my next question. I was halfway through it when suddenly she leaned forward, eyes like lasers. “What d’you mean 'handbagging’?” she cried. “D’you mean giving as good as you get? Well, they deserve it.”

Chastened, I left a much longer pause before moving on. But again she interrupted, even more passionately. “Does it mean giving better than you get? Well, they deserve that too!”

Someone once said that Mrs Thatcher couldn’t see an institution without hitting it with her handbag. More specifically, Charles Powell, her foreign affairs adviser, remarked that “she beat the bushes of Whitehall pretty violently”. She broke the long consensual approach to government that had lasted since the Second World War, which maintained that no matter who was in power, a touch on the tiller was all that the ship of state ever needed.

From the moment she arrived in Downing Street, Mrs Thatcher set about retuning the government machine so that it would run to her agenda. Some, especially ministers, hated it. “I wouldn’t even treat my gamekeeper like that,” complained the Tory grandee Christopher Soames, emerging from his first Cabinet meeting.

Yet Lord Armstrong, who was cabinet secretary for eight of her 11 years in power, believes that in 1979, senior civil servants awaited her arrival “with eagerness”. “Heath, Wilson and Callaghan had all been civil servants themselves and under them it had all been pretty awful,” he tells me. “Officials like strong ministers, not pushovers, and they were looking forward to the smack of firm government.”

The key to Mrs Thatcher’s style of government, he says, was that she saw herself as the guardian of her administration’s strategy. At its core, this consisted of economic liberalism, a greater role for markets, breaking the trade unions and a tough policy abroad, whether towards the Soviet Union or Europe. She would not tolerate anyone, minister or civil servant, doing or saying anything that conflicted with this. In his book The Prime Minister: The Office and its Holders Since 1945, Lord Hennessy quotes her as saying: “If you choose a team in which you encounter a basic disagreement, you won’t be able to govern. It must be a Cabinet that works on something much more than pragmatism or consensus. As prime minister I would not waste time having any internal arguments.”

Her command of detail was legendary, helped by the fact that she could survive on four or five hours’ sleep. Woe betide anyone who was not as in command of a brief as she was. The worst thing an official could say to her was: “I don’t know.” Yet her approach to what is now called evidence-based policy was gloriously ambivalent. Told that a report from the Central Policy Review Staff – CPRS – was based on the facts, she retorted: “The facts! I have been elected to change the facts.” Before long, she abolished the CPRS, a Whitehall think tank designed to serve the whole Cabinet, and replaced it with the current prime ministerial policy unit, which, as Lord Hennessy put it, “was hers to the last paperclip”. A believer in lean government, she also abolished the Civil Service Department, which seemed to produce reams of management “guff” unrelated to policy and which was headed by Sir Ian Bancroft, whom she disliked.

Yet despite her fearsome reputation, there is no evidence that she tried to politicise Whitehall. On the contrary – she liked those who stood up to her. One of her favourites was Sir Anthony Parsons, a larger-than-life diplomat and a consensus man to his fingertips. During the Falklands war, he won her over by saying sternly: “Prime Minister, will you please not interrupt me until I have finished?”

Her personal kindness to those who worked for her was striking. She had a heater installed over the door into No 10 to keep the attendants warm in the depths of winter. And when Lord Armstrong was mauled in the Australian courts over the Spycatcher affair – he admitted to being “economical with the truth” – she kept in touch by phone, sympathising over the “terrible” Australian judge and presenting him with a couple of bottles of whisky as a thank-you when he returned.

She dominated her administration in every way, yet claims that she set out to destroy Cabinet government do not stand up, either. In the early years, she was careful to keep senior ministers on board, not least over the Falklands, and she rejected the idea of a Prime Minister’s Department. Cabinet ministers who went along with her agenda were left to run their departments in peace. Her weapons of control were argument, and the sacking or moving of anyone who fell out of line with her overall strategy.

Some never forgave her – and at the end, it was her Cabinet that brought her down. In the words of John Biffen, one of her ministers, her fall was “the revenge of the unburied dead”.